Legislative Update

We have decided to cancel the Legislative Agenda Task Force meeting scheduled for next Tuesday, January 24th at 7:45 am- 9 am.  We will have our first meeting on Tuesday, January 31st at 7:45 am - 9 am at our Chamber offices in the Bank of America room, and currently the following presenters are scheduled for that date: REBIC and the Greater Charlotte Apartment Association.  Also, Kerri Burke from McGuire Woods Consulting will be present to give us a Legislative Update.  Please RSVP to lzapata@charlottechamber.com, if you plan on attending this meeting so we may have an accurate headcount.

We value our member's input, so if you have not reserved a presentation date and would like to take advantage of this opportunity, please email me a date so we can reserve a spot for your organization..  The schedule is listed below for your reference.

Locations: Charlotte Chamber office, with one exception noted

Tuesday, January 31^st: 7:45 am – 9

Tuesday, February 7^th: 7:45 am – 9

Tuesday, February 14^th: 7:45 am– 9

Tuesday, February 21^st: 7:45 am – 9

Tuesday, February 28^th: 4:30 pm-5:45 pm *Different time, location TBD*

Tuesday, March 13^th: 7:45 am-9 FINAL VOTING DAY

In addition to the November elections, there have been recent transitions in key leadership roles of our local government.  County Commissioner Harold Cogdell was elected the new chair of the County Commission.  The four Republican members joined with Cogdell while the four Democrats voted for Jennifer Roberts.  Newly elected school board members Ericka Ellis-Stewart and Mary McCray were unanimously elected Chair and Vice Chair respectively.  Committee chairs will be named in the coming months and we will keep you posted.  City Councilman Patrick Cannon was re-elected by council members to serve as Mayor Pro Tem.  The lists of members of all three elected bodies are below. 

City
Mayor: Anthony Foxx
City Council At-Large members: Patrick Cannon, Claire Fallon, David Howard, Beth Pickering
City Council, District 1: Patsy Kinsey
City Council, District 2: James Mitchell, Jr.
City Council, District 3: LaWana Mayfield
City Council, District 4: Michael Barnes
City Council, District 5: John Autry
City Council, District 6: Andy Dulin
City Council, District 7: Warren Cooksey

County
County Commissioner: Harold Cogdell , Jr.
County Commission At-Large members:  Jennifer Roberts, Jim Pendergraph
District 1:  Karen Bentley
District 2:  George Dunlap
District 3:  Vilma Leake
District 4:  Dumont Clarke
District 5:  Neil Cooksey
District 6:  Bill James

School Board
Board of Education, Chairperson: Ericka Ellis-Stewart
Board of Education, Vice-Chairwoman: Mary McCray
Board of Education, At-Large member: Tim Morgan
Board of Education, District 6: Vacant, to be replaced in January 2012

The clout of the EPA remains hazy

For businesses in NC, the regulatory climate produced some victorious reforms this past year including the Regulatory Reform Act of 2011 which balanced job creation and environmental protection.  Yet, upcoming EPA regulation which could be detrimental to job growth and stability in NC still remains a pressing concern for the business community.  The Utility Maximum Achievement Control Technology rule (MACT) alone is estimated to have $10 billion in compliance costs and is being considered by the EPA.  Coupled with the Cross-State Air Pollution Rule,  47,000 NC jobs stand on the chopping block should both rules pass as legislation.  This uncertainty stemming from the EPA’s vast rulemaking will only hinder job creation and economic growth.  

Unemployment Insurance continues to affect NC employers

The state of NC is currently indebted to the federal government for a $2.6 billion loan used to  pay for the unemployment insurance program (UI) benefits.  Employers are responsible for paying the administrative costs and benefits of the UI program via the State Unemployment Tax (SUTA) and Federal Unemployment Tax (FUTA), thus there is no effect on the workers.  Due to the non-repayment of the $2.6 billion loan after 2 years, employers will see a .3% reduction in their FUTA tax credit, effective January 2012 and will increase by .3% each year until the loan has been fully repaid.  Unless there is reform to the UI program, employers will continue to bear this burden which will result in reduced resources for job creation.

Scrutiny in Congress

NC delegation voted last week in Washington D.C. on the Regulations From the Executive in Need of Scrutiny Act of 2011, which passed in the U.S. House in a 241-184 vote and has now been referred to the US Senate Committee on Homeland Security and Government Affairs.  The Act requires congressional approval of major rules  of the Executive branch before they may take effect.  “Major rules” being defined as potentially resulting in: an estimated annual effect on the economy of $100 million or more, a major increase in costs or prices, or significant adverse effects on competition, employment, investment, productivity, innovation, or U.S. competitiveness. Five members of the NC delegation voted in favor, five voted in opposition, and one member was not present to vote.  If the Act passes as legislation, this could mean a promising step on the path to checks and balances.    

Mobility Fund solicits transportation projects

The North Carolina Department of Transportation (NCDOT) is accepting submissions for candidate transportation project for the Mobility Fund.  According to the North Carolina 2009-2010 Appropriations Act, the NCDOT will select projects of statewide and regional significance that will relieve congestion and enhance mobility across all modes of transportation.  Funding is provided by unused gap funds and reduced monetary amounts from the Highway Trust Fund to the General Fund.  The first project to be funded is the Yadkin River Bridge Phase II project which is still under construction.  There is approximately $45 million remaining in the Mobility Fund for qualifying projects in the State Fiscal Year 13 (July 1, 2012-June 30, 2013), and $58 million each year thereafter.  In order to be eligible, the minimum requirements are as follows:

1. Projects must be on Statewide or Regional Tier facilities, tier designated by NCDOT.  Tier descriptions and facilities
2. Projects must be ready to have funds obligated within 5 years
3. Projects must be consistent with MPO/RPO transportation planning efforts; included in a transportation plan; consistent with local land-use plans where available
4. Projects must be in a conforming transportation plan in non-attainment or maintenance areas
5. Only project capital costs (right-of-way and construction) are eligible for the Mobility Fund, not maintenance, operation or planning costs
6. No minimum project capital cost will be established as a threshold for funding

Deadline for submissions is February 29, 2012, and may be emailed to ncmobilityfund@ncdot.gov.  Project submissions will be reviewed, analyzed, and scored with an expected score release date of May 2012. Click here  to access the form on the Mobility Fund website.  More than one candidate can be submitted however only a maximum of 5 candidate projects will be evaluated from any one Agency, Organization, or Municipality, County or other form of local/regional government.  Questions can be directed to Don Voelker (919) 707-4740, Alpesh Patel (919) 707-4742 or David Wasserman (919) 707-4743.

Following the Thanksgiving holiday, the legislature held a brief “special session” convening Sunday evening (11/27), with each chamber covering a few significant policies. Several policies were rumored to be considered, including veto overrides; a tribal compact; the Racial Justice Act; changes to brewery laws; a gas tax cap; and clarifications for teacher pay. In the end the only policies of which passed included amendments to the Racial Justice Act and brewery laws. 

Senate Passes Amendments to the Racial Justice Act, Up to the Governor… 

The Senate gave final approval last Monday evening (11/28) to changes to the Racial Justice Act, of which removes death row inmates’ ability to use statistical evidence of racial bias to challenge their sentences. While opponents argue that the changes are in fact a total repeal of the Act, proponents of the changes are mere reforms and modifications. North Carolina's district attorneys have been lobbying this month to roll back the law, saying it has become a backdoor way to halt capital punishment in the state.

The Senate’s passage with a vote of 27-17 means the measure now goes to the Governor for her to sign or veto. While there was no statement from the Governor’s office as to what she will decide, members of the Democratic Party seem confident that the governor will veto the measure since the Governor signed the initial Racial Justice Act into law in 2009. "I'm a real strong supporter of the death penalty," Perdue said. "We should not allow discrimination based on race, poverty or any other factor to infect the criminal justice system. I'm thinking about it hard." The governor has until December 29^th to act on the measure; if she doesn’t veto it or sign it, the bill becomes law without her signature. 

Gas Tax Cap “Dead” for Now…. 

The House primarily pointed their attention during the special session to a proposal to cap the gas tax. While the House approved the measure in an overwhelming vote, the Senate adjourned before considering it. The measure would have capped the tax at its current rate of 35 cents per gallons, which rises and falls every six months based on the wholesale of gasoline and some projections had an expected increase to 39 cents in January. With the Senate adjourning before consideration, Senate leader Phil Berger (R-Rockingham) stated that the timing was not good to cap the tax and restrict money flowing to road construction jobs and that the spring session was a better time to take a more comprehensive look at the gas tax and road funding. 

Those House members in favor of the gas tax cap purported that the cap would help consumers without substantially delaying road construction. Opponents, on the other hand argued that the cap and associated revenue loss would mean the loss of 2,800 jobs; with Department of Transportation officials citing a net loss of 495 million, affecting over 400 miles of paving projects and 72 bridges scheduled for repair or replacement. 

While the issue of the gas tax cap is technically “dead” for now since the Senate did not consider the measure, the General Assembly could take up the measure again in a future special session or during the official session in May. 

Senate & House Pass Changes to Brewery Laws 

A bill that will allow breweries to sell their own products, regardless of the fact if some of those projects are brewed by a sister location out of state passed both the House and Senate with overwhelming majorities. The changes to the state Alcoholic Beverage Control laws will, according to supporters, allow some western North Carolina breweries to expand and create jobs.

House Passes Democratic National Convention Resolution 

Before adjourning, the House approved a nonbinding resolution asking the Democratic National Convention to changes to rules and “respect North Carolina’s right-to-work laws.” The resolution asks the convention to “refrain from hiring workers and companies from outside the state when qualified businesses or workers are available within the state.”

The resolution was in reaction to concerns by some that North Carolina firms were not getting contracts for the September convention because they are not unionized entities. While opponents of the measure argued there was no evidence to suggest nonunion workers were getting bypassed for union firms, proponents insisted they wanted to make sure the convention in Charlotte hired local workers. 

What is Next?... 

Per the adjournment resolution passed earlier in November, the General Assembly is scheduled to reconvene again for two additional special sessions on February 16^th and April 23^rd. It is possible that the General Assembly will be called to an additional session before or in the interim to deal with specifically the tribal compact Governor Perdue and the Eastern Band of the Cherokee Indian finalized last week. While the House and Senate did not consider the agreement during this past special session, citing additional time needed for review, both leaders indicated they anticipated an additional session to be called by the governor in the near time. 

New State Fiscal Report….Surplus Money

State revenue collections are ahead of projections that were set when lawmakers approved the state budget earlier this year. A report given by the Fiscal Research Division last week showed that the state has taken in $115 million above the roughly $6 billion expected through October 31^st, the first four months of the fiscal year. Staffers indicated that the amount of taxes withheld from worker paychecks is improving and corporate income tax collections are above targeted levels. 

Click here to review the full report. 

Lawmakers convened in Raleigh this week for a one-day special session to implement technical corrections to the redistricting maps they approved earlier this year, following the U.S. Justice Department announcing the pre-clearance of the redistricting maps. The corrections were needed after a computer code error was found to have left out more than 200 small portions of the state in the new district maps. The General Assembly passed five bills making technical corrections to House, Senate, and congressional districts, as well as Wake County judicial districts, and Greene County commissioner races.

Opponents, voting against the technical corrections claimed that the legislation was unconstitutional in that the new districts were already official enacted having been pre-cleared by the U.S. Justice Department and the state constitution only permits legislative districts to be redrawn once every 10 years. Proponents, on the other hand argued that the legislative corrections do not “change” map boundaries or the population statistics to the districts originally approved by lawmakers and rather only corrected language in the bills arising from the software glitch.

Lawsuits were filed this week challenging the new congressional and legislative districts, with more expected to be filed in the coming weeks. The lawsuits filed, encompassing former and current state legislators, local government officials, and advocacy groups contend that the split precincts divided counties and racially gerrymandered districts, violating the state and federal constitutions. In addition to asking that the districts be thrown out, the lawsuits seek injunctions to stop the new districts from being used for election filing, primaries or general elections in 2012. Leaders of the legislative redistricting committees to reiterate this week that they believe the redistricting maps will withstand court challenges, with Sen. Rucho saying: “The fact that the Justice Department had a chance to review the maps completely, and responded that they were comfortable with our maps and they followed the letter of law, makes the arguments moot.”

What is Next? Lawmakers Set Schedule for Future Special Sessions

Before leaving town, lawmakers adopted an adjournment resolution calling for the General Assembly to reconvene for three additional special sessions: November 28^th, February 16^th and April 23^rd. The resolution permits consideration of a wide array of issues, ranging from election laws and gambling to hurricane disaster relief and capping the state gas tax. In addition, lawmakers are permitted to consider veto overrides, any bills currently in conference committees and any of the local bills pending in the House Rules committee, wherein procedure could permit the bills to be stripped of their current content and used as vehicles for other legislation.

Republican leaders said their main objective in the multiple reconvening sessions is to respond as needed to the redistricting lawsuits. Any other items for consideration will depend on how long lawmakers want to convene and whether leaders in both chambers can work out agreements on vetoed or controversial bills. Some items rumored to be in consideration during the November 28^th special session include:

• Expanding Gaming Offerings (Eastern Band of Cherokees’ Casino)
• Gas Tax Cap
• Changes to State’s Alcoholic Beverage Control Laws
• Hurricane Irene Assistance Package for Farmers & Others
• Election Reform: Limits on Campaign Donations by Vendors with State Contracts
• Veto Overrides

North Carolina’s Off-Year Election Results

Tuesday, November 8^th was Election Day in Charlotte as well as numerous communities throughout North Carolina and across the nation.

Click here to review the full election results for Mecklenburg County. 

Charlotte has been fortunate to be visited by presidents and representatives of their administrations over the years.  In my time here, we've been visited by the Clinton Administration, the Bush Administration and the Obama Administration.  In fact, all three of those presidents have spent time in Charlotte.

When a sitting president wants to hear from the Charlotte business community, they ask the chamber to host those visits.  When those calls come, we work to create the opportunity for our members to interact with those representatives.  When George W. Bush served as President, we hosted the President himself, Vice President Dick Cheney and Labor Secretary Elaine Chao.  During this current administration, we've hosted Treasury Department representative Michael Barr and DOT Secretary Ray LaHood.

This morning, we had the opportunity to host Federal Transit Administrator Peter Rogoff.  You likely know he was in town with Secretary LaHood as they announced the beginning of the expenditures of the grant to build part of our streetcar line.  The purpose of his visit with us was to have a business roundtable.  We were encouraged to share concerns or ask questions.  Administrator Rogoff said if he couldn't answer them, he would connect us to someone who could.

Given the short turn around time, we were able to pull together a small but engaged and diverse group of business people.  The concerns and issues we discussed were also very diverse. They included:

• the regulatory burden is affecting business growth
• the regulations regarding banking, mortgages and foreclosures are having unintended consequences on lending to business
• the regulatory agencies are sending mixed messages to financial institutions when it comes to requiring significant reserves to balance weak assets
• our state's Right To Work status and decisions of the NLRB related to SC's Boeing plant are affecting manufacturers and the construction industry as they determine whether to expand
• What happened to the Bowles Simpson report

Rogoff committed to take our concerns back to Washington and to share them with his colleagues.  He shared with us that parts of the Bowles Simpson plan are actually seeing movement in Congress.  We encouraged them to let more people know that is the case.

In addition to sharing concerns, the group voiced appreciation for the funding for transportation projects and for innovation in energy research that have been received in the Charlotte region as well as for the president's decision to overrule EPA's proposal to lower the NAAQS Ozone Air standard.

We're likely to have a few more opportunities for this type of communication with the current administration over the next twelve months.  I hope you'll join us when we do.